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Uber is offering its nearly 7,000 laid off employees a generous severance package including at least 10 weeks' pay, stock, and healthcare until the end of 2020 (UBER)

Dara Khosrowshahi
  • The 25% of Uber's global workforce laid off in May will receive a fairly generous severance package of at least 10 weeks pay and healthcare paid for all of 2020.
  • Uber says explained to us the special assistance it is offering to visa holders and new parents still out on parental leave who got cut.
  • The company will follow Airbnb's lead and publish a directory of all the people who were affected in order for recruiters to find them more easily, it says.
  • Meanwhile, CEO Dara Khosrowshahi and Uber's board say they are forgoing their cash salaries for the remainder of the year.
  • Visit Business Insider's homepage for more stories.
On Monday, Uber announced a second round of layoffs, cutting 3,000 jobs. In the last two weeks, the company has cut 25% of its global workforce, or nearly 7,000 employees.
Uber is providing all employees laid off during the COVID-19 crisis with a fairly generous layoff package. It says that each of these employees will receive:
  • a minimum of 10 weeks pay (plus more depending on tenure)
  • health benefits through the end of the year
  • additional payment for equity for employees within three months of their one-year cliff for their new-hire award; those employees will receive a prorated cash payment for the equity that would have vested
  • outplacement/recruiting support.
Uber will also promote an online Talent Directory to help publicize the newly available employees to recruiters, which follows in the footsteps of what Airbnb did to promote the employees it laid off this month. Airbnb's severance package was widely praised as a humane example of how to conduct layoffs.
Uber has added a couple of extra aspects to its severance package, too.
It says it will provide additional support to Uber-sponsored visa holders. Visa holders who get laid off must land another job within a couple of months and have that employer petition to sponsor the visa, or they could be deported. Uber says H1B visa employees will be given a 30-day transition period, where they will work for the company to give them extra time to secure a new job and a new visa. They will also get access to experts to answer questions and could qualify for a cash allowance towards visa related expenses.
It's worth pointing out that CEO Khosrowshahi has been a vocal supporter of immigrants as he is one himself. He came the US as a refugee from Iran when he was a child.
Uber says it is also taking special considerations for laid-off workers who are out on parental leave. While there are various laws that prevent employers for firing someone because they are out on maternity leave, if an employer can terminate employment for a legitimate reason, an employment lawyer says.
It is, however, perhaps an especially daunting matter for the employee who is in a short-term life situation that makes it difficult to go job hunting. So Uber employees currently who are laid off but on parental leave will remain employed and on leave through their scheduled return date, continue to receive healthcare benefits and vest in equity through that date, the company says. Employees with planned leaves of absence in the future will receive a cash payout for the period (up to 18 months) and may qualify for a cash payment for their stocks that would have vested during that approved leave of absence period, the company says.
Such a benefit package will be expensive for Uber. In an SEC filing on Monday, Uber said these mass layoffs will cost the company between $175 million and $220 million, with $110 million to $140 million related to severance and other termination benefits (excluding stock-based compensation expense). This is in addition to the $35 million to $40 million of charges related to severance and other termination benefits, excluding stock, it will incur relating to the 3,700 jobs it cut on May 6. It doesn't explain why the smaller layoff will cost it more, but this could be due to the higher salaries and seniority of the people it is cutting.
On the other hand, Uber says that the layoffs will ultimately save the company $1 billion annually.
One other difference between this layoff and the one earlier this month: Many employees are learning that they lost their job via 1:1 calls with HR. Two weeks ago, Uber conducted layoffs in mass Zoom meetings. The company says that every individual impacted with this layoff has, or will receive, a 1:1 with a human resources representative to discuss their individual exit packages.
It's worth noting that Uber's CEO Dara Khosrowshahi announced the layoff and severance news on Monday in a heartfelt email. "I am truly sorry. I know this will cause pain for you and your families, especially now," he wrote.
He backed up those words with actions in a worthy if mostly symbolic gesture by announcing on May 6, the day that Uber cut its first 3,700 employees, that he was giving up his cash salary for the remainder of the year. He is paid $1 million base salary. However most of his compensation is in stock, worth about $37 million in 2019.
On Monday, the board of directors said in an SEC filing they will forgo their cash retainers as well, which range from about $80,000 to over $200,000 depending on their committees and responsibilities.
Are you an Uber insider with insight to share? Contact Julie Bort via email at jbort@businessinsider.com or on encrypted chat app Signal at (970) 430-6112 (no PR inquiries, please). Open DMs on Twitter @Julie188.  
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